Help a Newbie buy some shares
Discussion
So, about 4 weeks ago I opened a H&L Stocks and Shares ISA. I have no experience of buying shares etc but after reading some of the threads on here I wanted to give it a go. At this stage I want to see what it is all about and understand the process. I am not about to move my pension pot or make significant investments, just have a play.
I transferred £500 into the account to get me started and was about to go ahead and buy some funds. I started to have a look but got lost in the bewildering number of different ones so didn't proceed any further. (Lucky me
)
Anyway, today I thought it would be a good day to have a look again and maybe make a purchase. So I thought go for £200 worth of 'Legal & General UK Index Class C - Accumulation (GBP)' and proceeded to 'buy'
The following message comes up:
There are four stages to fund dealing:
Pending - when we first receive your deal it will be shown as pending. Funds deal once a day or, in a very few cases, less frequently so we provide instructions to fund managers daily before their cut off time. When you switch funds and choose to enter a number of units or sell the entire holding please note your purchase will remain pending until the amount raised by your sale has been confirmed by the fund manager.
Submitted for dealing - your deal has been submitted to the fund manager and can no longer be cancelled.
Dealt, awaiting confirmation - your order has been dealt. The fund manager can take up to five days to confirm the details of your completed deal, although in most cases it takes less than 24 hours. When we receive confirmation of your deal your account summary and transaction history will be updated and we will generate a contract note.
So it could easily take until Monday before it is submitted and then take a further 5 days for confirmation from the fund manager?
I thought it would be more real-time?
I transferred £500 into the account to get me started and was about to go ahead and buy some funds. I started to have a look but got lost in the bewildering number of different ones so didn't proceed any further. (Lucky me
)Anyway, today I thought it would be a good day to have a look again and maybe make a purchase. So I thought go for £200 worth of 'Legal & General UK Index Class C - Accumulation (GBP)' and proceeded to 'buy'
The following message comes up:
There are four stages to fund dealing:
Pending - when we first receive your deal it will be shown as pending. Funds deal once a day or, in a very few cases, less frequently so we provide instructions to fund managers daily before their cut off time. When you switch funds and choose to enter a number of units or sell the entire holding please note your purchase will remain pending until the amount raised by your sale has been confirmed by the fund manager.
Submitted for dealing - your deal has been submitted to the fund manager and can no longer be cancelled.
Dealt, awaiting confirmation - your order has been dealt. The fund manager can take up to five days to confirm the details of your completed deal, although in most cases it takes less than 24 hours. When we receive confirmation of your deal your account summary and transaction history will be updated and we will generate a contract note.
So it could easily take until Monday before it is submitted and then take a further 5 days for confirmation from the fund manager?
I thought it would be more real-time?
This is the effect of forward pricing which is how unit trust type funds work.
The procedure is:
1. You put in your request to deal eg. 10am
2. No more deals are allowed after the cut-off eg. 5pm
3. The fund is valued and a price struck, which could take another day
4. The price is then applied to all deals at the cut-off, contract notes issued and share register updated
If you want a faster response the you can buy ETFs instead which do the same thing but are priced in real-time.
The procedure is:
1. You put in your request to deal eg. 10am
2. No more deals are allowed after the cut-off eg. 5pm
3. The fund is valued and a price struck, which could take another day
4. The price is then applied to all deals at the cut-off, contract notes issued and share register updated
If you want a faster response the you can buy ETFs instead which do the same thing but are priced in real-time.
I think products such as that aren't really designed for real-time trading especially in this environment, but I do agree it is still unacceptable in 2020 & seems less than transparent.
My company shares for example, If I log in to sell some I get given an instant price during market hours which I can lock in immediately.
My company shares for example, If I log in to sell some I get given an instant price during market hours which I can lock in immediately.
DaveCWK said:
I think products such as that aren't really designed for real-time trading especially in this environment, but I do agree it is still unacceptable in 2020 & seems less than transparent.
My company shares for example, If I log in to sell some I get given an instant price during market hours which I can lock in immediately.
Unit trust prices are very different to company share prices.My company shares for example, If I log in to sell some I get given an instant price during market hours which I can lock in immediately.
For company shares, the price changes second by second depending on what people are willing to sell and buy them for.
For unit trusts, the price is calculated once a day by the fund administrator using an accounting calculation that uses underlying holding values, cash balances, accrued charges and interest etc. This is all tightly managed within the confines of rules and checks designed to protect the customer.
Thanks for the responses - makes sense.
I was aware that these funds were really not ideal for trading and my intention was not to buy and sell but to just buy in at the current price. Hence I was surprised to see that it would take several days to actually get 'in' and the price would be unknown.
From some of the posters on these threads it seemed that they were buying and selling instantaneously, if that means it is shares in individual companies then that isn't for me!
Thanks again.
I was aware that these funds were really not ideal for trading and my intention was not to buy and sell but to just buy in at the current price. Hence I was surprised to see that it would take several days to actually get 'in' and the price would be unknown.
From some of the posters on these threads it seemed that they were buying and selling instantaneously, if that means it is shares in individual companies then that isn't for me!
Thanks again.
PurpleFox said:
Thanks for the responses - makes sense.
I was aware that these funds were really not ideal for trading and my intention was not to buy and sell but to just buy in at the current price. Hence I was surprised to see that it would take several days to actually get 'in' and the price would be unknown.
From some of the posters on these threads it seemed that they were buying and selling instantaneously, if that means it is shares in individual companies then that isn't for me!
Thanks again.
I’m in the same boat. Have some funds with Nutmeg. Paid another £700 in on Wednesday expecting it to be invested Thursday but have since been told they delayed their investment day until Friday this week and prices have since gone up. I was aware that these funds were really not ideal for trading and my intention was not to buy and sell but to just buy in at the current price. Hence I was surprised to see that it would take several days to actually get 'in' and the price would be unknown.
From some of the posters on these threads it seemed that they were buying and selling instantaneously, if that means it is shares in individual companies then that isn't for me!
Thanks again.
Would prefer something instantaneous or at least same day. Someone mentioned ETF’s to me which I’ll have a look into.
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